Taming Southeast Asia's 'Golden Rectangle' : Economy: Planners hope to connect areas of China, Thailand, Laos and Burma in an alliance to promote trade and tourism.

L.A. Times Archives

Nov. 22, 1993 12 AM PT

From Associated Press

VIENTIANE, Laos —

It’s been dubbed the “Golden Rectangle”--a largely inaccessible region of Southeast Asia inhabited by opium warlords, guerrillas and impoverished tribes. The area doesn’t look like a candidate for the next economic miracle.

But enthusiastic planners and officials in four countries have embarked on ambitious projects to bring one of the continent’s last frontiers into the 1990s and in contact with the rest of the economically vibrant region.

The “Golden Rectangle” would connect areas of southwest China, northern Thailand, Laos and eastern Burma into a loose but profitable partnership to promote trade and tourism and build cross-border infrastructure.

Similar, informal relationships are developing elsewhere in Asia, notably the “growth triangles” of Singapore, Malaysia and nearby areas of Indonesia, as well as Hong Kong, Taiwan and China’s south coast.

Advocates such as the Asian Development Bank say the booming economies of China and Thailand coupled with the untapped resources of Laos and Burma would make a winning combination.

They also cite the importance of the mighty Mekong River, which winds through the heart of the rugged region and has tremendous but untapped potential for hydroelectric power and transport.

But there are also obstacles, as the development bank noted in a recent report. The landlocked region lacks roads and other basic infrastructure needed for economic takeoff. It’s also among the poorest in Asia--annual per-capita incomes in Burma and Laos are below $250.

Ethnic minority rebels and opium traffickers control enclaves in western Burma, while concern among the region’s smaller partners about China’s size, power and future intentions could also impede progress.

“The formation of the Golden Rectangle is inevitable because of the geo-economic advance of China to the south,” says Thai political scientist Sukhumbhand Paribatra. “One has to be very careful, because this advance will be linked to the region’s powerful local Chinese communities.”

Michael Leifer, a political scientist at London’s International Institute of Strategic Studies, notes a persistent if sometimes submerged fear of 1.2 billion Chinese looking for more living space and eyeing Southeast Asia.

“There’s an old Burmese proverb: ‘If China spits, Burma drowns,’ ” Leifer said.

Most immediately, the Thais are concerned about the cheap, competitive Chinese goods that are finding their way south, largely through the region’s extensive smuggling networks. Illegal workers and prostitutes from China’s southern Yunnan province have been turning up in Thailand in greater numbers.

But some Thai politicians and planners are almost as enthusiastic about the concept as officials in Yunnan, which needs easier access to the sea for its goods.

Laos, with 4.5 million people and the smallest of Southeast Asia’s 10 economies, is cautiously measuring its potential gains.

One benefit, according to Australian Ambassador Michael Mann, is that investors will no longer dismiss Laos as a tiny market and will recognize its strategic economic position.

Meanwhile, key roads are being built and other transport projects were given top priority during an Asian Development Bank meeting last August in Manila. The bank is seeking to serve as the “catalyst” for the region.

The first major span across the Mekong, the Australian-donated Friendship Bridge linking the northeastern Thai town of Nong Khai with Vientiane, the Laotian capital, is due to open next April.

With the bridge and an all-weather highway in northern Laos complete by 1995-96, one will be able to travel from Singapore through the core of the region to Beijing.

Also under consideration is a rail link from Thailand through Laos--which has none at present--to southern China, the dredging of rapids along the Mekong to allow for larger vessels, several new air routes from Yunnan to Thailand.

With better transport and the easing of border formalities, tourists are expected in significant numbers, drawn to the region by spectacular scenery, ethnic minorities that retain many of their traditions and a mystique of the forbidden.

Some of that aura comes from the “Golden Triangle,” the world’s largest source of opium, which partly overlaps with the Golden Rectangle.

Asia’s Last Frontier

China, Thailand, Burma and Laos have embarked on an ambitious program to link the remote but resource-rich region dubbed the “Golden Rectangle” with the rest of booming Asia.

Gross domestic product, or GDP, is the total value of goods and services produced within a country’s borders. GDP per capita is expressed here in terms of purchasing power parity, which measures consumers’ ability to purchase goods and services within their own economy and in local currency.

Gross national product, or GNP, is the total value of goods and services produced by a country both inside and outside its borders.

CHINA:

Population: (1991) 1.17 billion

GDP per capita: (1990) $1,990

GNP growth: (1980-90) 9.5%

Economy: 16.7% agriculture, 58.4% industry and 24.9% services

THAILAND:

Population: (1991) 55.4 million

GDP per capita: (1990) $3,986

GNP growth: (1980-90) 7.6%

Economy: 13.1% agriculture, 37.4% industry and 49.5% services

BURMA: